Elon Musk has proposed a potential shift in the business model of X, formerly known as Twitter. A Move that will potentially sound the death knell of one of the world’s most-used platforms.
During a live-streamed discussion with Israeli Prime Minister Benjamin Netanyahu, Musk hinted at the implementation of a nominal monthly fee for utilizing the X platform. He emphasized that this alteration was imperative in addressing the prevalent issue of bots on the network.
Why Musk is Charging Every User for X
Musk elucidated, “It’s the only way I can think of to combat vast armies of bots. Because a bot costs a fraction of a penny. Call it a tenth of a penny. But even if it has to pay a few dollars or something, the effective cost of bots is very high.” Going further to state that bot creators would need to set up new payment methods for each subsequent bot. Adding an additional deterrent. While Musk refrained from specifying the exact subscription fee, he characterized it as a modest sum.
In the course of the conversation, Elon Musk divulged updated statistics for X. Disclosing a user base of 550 million individuals who collectively generate between 100 to 200 million posts daily. It is however unclear if these numbers include automated accounts. Both legitimate and spammy bots.
These metrics, however, do not permit a direct comparison with Twitter’s user base prior to Musk’s stewardship. Twitter employed a specific metric known as the “average monetizable daily active user” (mDAU). This older metric suggested users potentially monetizable through ad views, with Q1 2022 figures showing 229 million mDAUs. Musk refrained from providing additional details regarding the proposed charges or the timeline for their implementation.
The broader discussion between Musk and Netanyahu centered on artificial intelligence technology. And its regulatory framework, with a brief foray into the issue of hate speech on the X platform. Musk asserted his stance against antisemitism and any form of content that fuels animosity and discord. However, Musk recently engaged in a dispute involving the threat of a defamation lawsuit against the Anti-Defamation League. Which had accused both Elon Musk and X of exhibiting antisemitic tendencies.
Elon Musk Should Rethink His X Monetization Strategies
Following the acquisition of Twitter in October 2022, Elon Musk wasted no time in enacting a series of substantial alterations. The first order of business was the renaming of the platform as “X.” Shortly thereafter, in March, Musk did away with the traditional blue verification badges, bringing in the Twitter Blue subscription program.
Since last year, the company has been encouraging users to subscribe to its premium service X Premium. Which is priced at $8 per month or $84 annually. This subscription offers a range of features including post editing. There’s reduced ad exposure, enhanced search and conversation rankings, extended post lengths, and more.
These sweeping changes form the basis of Musk’s overarching plan to steer the platform toward profitability. In a candid admission in July, he acknowledged the financial hurdles facing the company. “We’re still negative cash flow, due to a 50% drop in advertising revenue plus a heavy debt load. Need to reach positive cash flow before we have the luxury of anything else.”
Afterward, the Starlink CEO launched an initiative to extend the creator monetization program. Now, a share of the advertising revenue generated from ads displayed in response to creators’ posts is allocated to eligible individuals. The company has affirmed that this measure is part of its broader endeavor to empower users to better monetize their presence on the platform.
Eligibility extends to subscribers of Twitter Blue, as well as verified organizations. Creators with over 5 million monthly tweet impressions for the past three months are included. Together with those who successfully pass the human review for Creator Monetization Standards.
Twitter X Memorabilia Auction
Elon Musk recently announced an online auction of X(Twitter)-related memorabilia. At a price point of $25, which is to be held next month. This move, while strategically directed at fighting bots, introduces a paywall that impinges on the platform’s original purpose of serving as an open space for all.
Nevertheless, this strategy is in line with Musk’s vision of generating revenue directly from the user base. It’s undeniable that the introduction of a paywall will have reverberations across social media. Users disinclined to pay for platform access may move to other X alternative apps/competitors.